Federal Debt and Deficit Reduction Plans
Federal debt is a public debt which represents the federal securities owned by individuals or institutions outside the United States government and United States Treasury securities that are administered by the United States government. The United States government has to take some action to reduce the Federal debt as it is rapidly increasing. The Federal debt is represented by the Treasury of United States.
The total outstanding public debt as on 6th May 2011 is $14.32 trillion which is approximately 98% of the GDP (Gross Domestic Product) of $14.66 trillion. The rising level of federal debt may cause the fiscal crisis in the United States. Investors may not finance government if they are not compensated with very high interest rates for their money. Thus, interest rates will also rise with the debt. This problem can be solved only if the economy recovers. This recovery improves the deficit situation as people earn well. But, even if the economy recovers, the federal spending is expected to increase than revenues so the government has to continue...
The congressional Budget Office (CBO) states that if the same situation continues for long time the deficits will remain high throughout this decade and beyond and the debt might reach 90% of the GDP in 2020 (Huntley, 2011).
Forecasting the debt is a difficult process for number of reasons. While forecasting the debt we make lot of assumptions which may not happen as expected and that might cause changes in the real debt. As per the budget which is proposed by President Barack Obama in 2010 the debt was estimated to increase up to $20 trillion by 2015 and was estimated to increase 100% of the GDP by 2020 and remain same in the next years.
Barrack Obama has given many deficit reduction plans to reduce $4 trillion in the next 12 years, among them I would like to recommend the President for tax reforms and to collect the contribution by the healthcare to reduce the deficit.
1. Deficit can be reduced by Tax reforms
The present income tax system for individuals is fundamentally unfair, complicated and confusing. Most taxpayers…
When the economy suddenly has more money circulating around there is the threat of inflation. "The Federal Reserve is expected to hold its main short-term interest rate at a 45-year low of 1% at its last meeting of the year in December, as well as into part of 2004, economists predict. Holding short-term rates at such low levels might motivate consumers and businesses to spend and invest more, something that
Health Care Reform Federal Deficit The American Health Care Crisis and the Federal Deficit The United States spends more than any other country on medical care. In 2006, U.S. health care spending was $2.1 trillion, or 16% of our gross domestic product. At the same time, more than 45 million Americans lack health insurance and our health outcomes (life expectancy, infant mortality, and mortality amenable to health care) are mediocre compared with
" What this shows is how the current financial crisis / recession have placed a drag on both programs that are facing severe challenges from the large numbers of uninsured. Where, the lack of health insurance is indirectly forcing people to turn to both programs, once their condition becomes so severe that it can no longer be ignored. At which point, the costs increase to treat these people which causes the
Mediocre material will, likely, thus be introduced into the market, and fledgling authors discouraged. This may in a matter of fact not only prove detrimental for general culture but also for the store itself, since discouraged with the level of prevalent reading matter, potential customers may frequent other locations for their desires. Conclusively, as an example of Mr. Flaherty's impact on the book-selling business, relaxation of tax demands on private
Ergo, economic growth through the private sector is not possible without federal deficit. In his own words, "while it is commonly believed that continual budget deficits will bankrupt the nation, in reality, those budget deficits are the only way that our private sector can save and accumulate net financial wealth" (Wray, 2009). 3. The Reformation of Entitlement Programs The article selected to answer the question relative to the future strategies that
Obama Care Plan Health care is undergoing a dramatic transformation and needless to say it is one of our largest industries that contribute handsomely to the Gross Domestic Product, greater demands are placed for the value of dollars that are being spent to provide for healthcare services to patients. Now-a-days, in this ever demanding environment marketing as a discipline is being practiced (Berkowitz, October 2010) In early days it was a great